Wanna tax rebate? You gotta file first
Taxpayers who file their 2007 tax returns on time will get their rebates sooner than those who seek extensions. Direct deposit will speed things along.
NEW YORK (CNNMoney.com) -- It remains to be seen if the economic stimulus package signed into law by President Bush on Wednesday really jumpstarts the economy.
But it's likely to light a fire under tax filers who like to dawdle. That's because filing your 2007 tax return is a prerequisite to getting your stimulus rebate check.
The IRS on Wednesday said it will begin mailing out rebates in May.
People who have already filed their 2007 tax returns and reported at least $3,000 in qualifying income don't need to do anything else. The IRS will assess their rebate eligibility and send a check to those who qualify. Qualifying income for the purposes of the rebate includes wages and salaries, Social Security benefits and certain veterans' and retired railroad workers benefits.
The IRS also said that it plans to send tax filers two notices: one to explain the stimulus payment program and a second one to confirm the amount of your rebate.
Acting IRS Commissioner Linda Stiff said in a press briefing that the second notice is likely to arrive 7 to 10 days before you receive your payment if you opt to have a check sent by mail. If, however, you opt for electronic direct deposit on your 2007 tax return, she said, the second notice may arrive simultaneously with your payment.
As with refunds, selecting "direct deposit" on your 2007 return is the fastest way to get your rebate payment, reducing the time it takes by at least a week. However, rebates will be sent by check to tax filers who have taken out refund anticipation loans or have entered into any other loan agreement with their tax preparer. That way, there is no chance of the rebate going into the tax preparer's account.
The IRS also noted that rebate checks will be sent separately from any 2007 refund you may have coming to you.
Some people who are eligible for a rebate may not receive one, at least not in full. If you owe back taxes or have other non-tax federal liabilities such as past-due child support or federal student loans, the IRS will apply at least part of your rebate to those liabilities.